# Capacity Retailer 1 - A local retailer is considering installing self-service checkout lanes into the current...

###### Question:

Capacity Retailer 1 - A local retailer is considering installing self-service checkout lanes into the current system. All the self-service lanes will be used for 20 items or less, and the new self-service kiosks can accept debit cards, credit cards or cash. Based on a study completed over the past 200 days from the current operations, he has recorded the following data for the peak hourly demand for purchases of 20 items or less. The data appears in the following table. The retailer hopes to achieve two customer related service goals. 3 First, he is interested in determining the number of self-service lanes necessary to meet the estimated peak hourly demand 95% of the time. Second, he is interested in determining the capacity required to accommodate 125 percent of the estimated average demand plus a 15 percent allowance for growth. Assuming that self-service kiosk can service 25 customers per hour, estimate the number of kiosks required for each of the two options. Are there any other issues to be considered? *** Note: you can copy and paste the table below into your answer area Number of Customers Probability Number of Days Average was Observed 10 Cumulative Probability 40 55 16 30 85 125 24 145 50 175 40 200 20 245 10

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